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At its lowest ebb, the Dow was down 1,597 points from Friday’s close. That came during a 15-minute stretch where the 30-stock index lost 700 points and then gained them back.

Market pros have been predicting a pullback for some time, noting that declines of 10 percent or more are common during bull markets. There hasn’t been one in two years, and by many measures stocks had been looking expensive.

“It’s like a kid at a child’s party who, after an afternoon of cake and ice cream, eats one more cookie and that puts them over the edge,” said David Kelly, the chief global strategist for JPMorgan Asset Management.

Kelly said the signs of inflation and rising rates are not as bad as they looked, but after the market’s big gains in 2017 and early 2018, stocks were overdue for a drop.

“We’re out of practice watching momentum going in the opposite direction.”

The Standard & Poor’s 500 index, the benchmark most professional investors and many index funds use, skidded 113.19 points, or 4.1%, to 2,648.94.

Specialist Meric Greenbaum works on the floor of the New York Stock Exchange.
Source: Richard Drew/PA Images

That was its biggest loss since August 2011, when investors were fearful about European government debt and the U.S. came close to breaching its debt ceiling.

The Nasdaq composite fell 273.42 points, or 3.8%, to 6,967.53.

The slump began on Friday as investors worried that creeping signs of higher inflation and interest rates could derail the US economy along with the market’s record-setting rally.

The stock market has been unusually calm for more than a year. The combination of economic growth in the US and other major economies, low interest rates, and support from central banks meant stocks could keep rising steadily without a lot of bumps along the way. Experts have been warning that that wouldn’t last forever.

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